Circle C Food Stores, a Huntsville, Ala.-based convenience store operator, filed for bankruptcy protection and plans to liquidate.
The company, which operates eight stores in the Birmingham area, cited debts of between $1 million and $10 million, and assets of less than $500,000 in a filing with U.S. Bankruptcy Court in Decatur, Ala.
The company, which operated about 25 stores overall, had the rug pulled out by lenders, said Kevin Heard, the Huntsville lawyer representing it.
“This economy is hurting companies with good track records,” Heard told The The Birmingham News. “When these folks lost credit, the company just imploded from within.”
Circle C is privately owned, mostly by founder Johnny Benson. Bankruptcy court records show Benson pumped $800,000 of his own money into the business in recent years to keep it afloat. Heard said the company intends to close stores, sell assets and pay creditors whatever it can.
Circle C joins a growing list of convenience store operators and jobbers to file for bankruptcy. Crescent Oil Co. Inc., Flying J and Appalachian Oil Co. (Appco) all filed Chapter 11 last month. For some, the situation is worse than others.
A trustee representing Appco’s estate and charged with looking after the interests of creditors, however, described the events since Appco’s Feb. 9 Chapter 11 reorganization filing as “putting bandages on an open wound” and expressed grave doubts about Appco’s prospects for successful reorganization.